Providence Poll: Voters Worry Over City Finances, Pension Reform

September 26, 2012

Most Providence voters — nearly 86 percent — are concerned about the city’s budget issues but are divided on suggested ways to reform the current pension plan, according to a recent public opinion survey conducted by the Taubman Center at Brown University. The survey was undertaken in conjunction with the annual Thomas J. Anton/Frederick Lippitt Urban Affairs Conference, scheduled for Thursday, Oct. 25, 2012, at Brown.

PROVIDENCE, R.I. [Brown University] — Voter sentiments over the state of Providence finances have changed little during the last year, according to a new Brown University survey. A significant majority of Providence voters (85.9 percent) characterized the city’s budget problems as somewhat serious or very serious. This response is similar to a Brown University poll taken around the same time last year, when 86 percent of city voters said that they didn’t believe the city was recovering well from the recession. Despite these continuing concerns, Mayor Angel Taveras’s approval rating has risen to 60 percent, up more than 10 points in the last year.

Researchers at the A. Alfred Taubman Center for Public Policy and American Institutions and the John Hazen White Public Opinion Laboratory at Brown University surveyed a random sample of 425 of Providence’s registered voters from Sept. 13 to Sept. 22, 2012. Overall, the poll had a margin of error of plus or minus 4.7 percent. This survey was undertaken in conjunction with the Taubman Center’s annual Thomas J. Anton/Frederick Lippitt Urban Affairs Conference. This year’s conference, “Pensions in Peril: How Municipalities Are Defusing This Fiscal Time Bomb,” is scheduled for Thursday, Oct. 25, 2012, at 4 p.m. The conference will focus on how local governments, including Rhode Island’s cities and towns, are addressing this urgent budget challenge.

The Taubman survey asked voters to respond to several questions regarding pension reform. A significant majority (64.0 percent) said they are aware of the unfunded pension liability issue facing Providence and other cities, while 64.7 percent of Providence voters believe that all affected parties — retirees, current workers, and future workers — should bear an equal share of the burden of pension reform. When asked about specific cost-saving reforms, nearly the same number (67.3 percent) supported switching city employees to a 401(k)-style plan.

Providence voters were divided about other ways to address pension liability. They were split on raising the retirement age for city workers (45.9 percent support/43.8 percent oppose) and raising co-pays for health insurance (42.4 percent support/46.1 oppose). Eliminating cost-of-living adjustments for city pensions received slightly more support from voters (48.5 percent support/35.1 percent oppose).

Voters were also queried about the pension liability deal that Mayor Angel Taveras, public safety retirees, and the city’s three major unions made in June. The agreement would lower pension costs by reducing benefits promised to retirees and current workers. City officials have said that these changes have allowed Providence to avoid bankruptcy. Under the agreement, the city would cap all pensions, suspend cost-of-living adjustments for 11 years, and eliminate the five and six percent compounded cost-of-living adjustments. Almost 45 percent of voters were satisfied with the agreement, 20.5 percent were dissatisfied, and 23.8 percent were neither satisfied nor dissatisfied.

Voters were also asked about the Central Falls bankruptcy, which allowed the city to force public safety unions to the bargaining table to negotiate changes in the city’s retirement obligations. When asked if they thought bankruptcy is a legitimate tool for local government to resolve pension liability issues, 48.0 percent of voters agreed and 37.2 percent disagreed.

On a personal level, only 22.5 percent of voters said that their own financial situation was better than a year ago. Nearly a third (31.2 percent) said their financial position was about the same and a similar number (30.5) said they were worse off than a year ago. However, Providence voters expressed optimism about their future finances, with just 6.4 percent predicting that they would be worse off a year from now. A large majority (78 percent) expected that their finances would either improve (34 percent) or stay the same (44 percent).

Providence voters expressed much less optimism when asked about their own retirement. Asked if they would be able to maintain their current quality of life in retirement, just 11.1 percent were very confident that they would, while 29.7 percent were not confident, and nearly the same number (29.6 percent) were unsure either way. When asked whether the primary responsibility for preparing for retirement rests with the worker, the employer, or both equally, a large majority (70.1 percent) felt that the employers and workers are equally responsible.

Overall, Providence voters gave high marks to a number of city services including garbage collection (82.8 percent satisfied/very satisfied), fire and ambulance service (85.9 percent satisfied/very satisfied), neighborhood parks (71.1 percent satisfied/very satisfied), and police (64.9 percent satisfied/very satisfied). Providence voters gave low scores for upkeep of roads (58.8 percent dissatisfied/very dissatisfied) and were split about the quality of public schools, with 36.1 percent expressing satisfaction and 36.9 percent dissatisfied.

For more information contact Marion Orr at 401-863-9436.

Questions and answers

How would you rate the job Angel Taveras is doing as mayor of Providence? excellent 18.1%; good 41.9%; only fair 19.5%; poor 8.0%; don’t know/no answer 12.5%

How would you rate the job Barack Obama is doing as president? excellent 27.1%; good 41.2%; only fair 14.8%; poor 13.9%; don’t know/no answer 3.0%

Would you describe the state of Providence’s economy these days as excellent, good, not so good, or poor? excellent 1.4%; good 15.1%; not so good 45.6%; poor 36.2%; don’t know/no answer 1.7%

Generally speaking, would you say things in Providence are going in the right direction or have they gotten off on the wrong track? right direction 38.4%; off on the wrong track 37.2%; mixed 16.2%; not sure 6.8%; no answer 1.4%

Would you say that you (and your family living there) are better off or worse off financially than you were a year ago or just about the same? better off 22.5%; worse off financially 30.5%; about the same 31.2%; don’t know 11.6%; no answer 4.2%

Do you think that a year from now you (and your family living there) will be better off financially, worse off, or just about the same as now? better off 34.0%; worse off financially 6.4%; about the same 44.0%; don’t know 14.2%; no answer 1.4%

Which would you say is more likely — that in the city as a whole we’ll have continuous good times during the next five years or so or that we will have periods of widespread unemployment or depression? continuous good times 31.9%; periods of widespread unemployment 38.6%; don’t know 25.7%; no answer 3.8%

How serious do you think Providence’s budget problems are - very serious, somewhat serious, not so serious, or not at all serious? very serious 52.0%; somewhat serious 33.9%; not so serious 6.8%; not at all serious 0.2%; don’t know/no answer 7.1%

Cities and towns in Rhode Island and across the country are facing unprecedented budget shortfalls as a result of unfunded pension liabilities for firefighters, police officers, and other city workers. Many people say the pension spending is “out of control.” Which of the following items would you 1) support or 2) oppose, to control spending on municipal pensions?

Eliminate the cost of living adjustments for all city pensions: support 48.5%; oppose 35.1%; don’t know/no answer 16.4%

Offer a "defined contribution" retirement plan similar to 401K for all city employees? support 67.3%; oppose 15.8%; don’t know/no answer 16.9%

Raise the age at which city workers can retire: support 45.9%; oppose 43.8%; don’t know/no answer 10.3%

Require city workers to work for a longer period of time before retiring: support 48.0%; oppose 37.9%; don’t know/no answer 14.1%

Recently the mayor of Providence, public-safety retirees and Providence’s three major unions reached a tentative agreement to allow the city to cap all pensions, suspend cost-of-living adjustments (COLAS) for 11 years, eliminate the 5 and 6% compounded COLAs, and move retiree health coverage to Medicare. Would you say you are very satisfied, satisfied, neither satisfied or dissatisfied, dissatisfied, or very dissatisfied with this agreement? very satisfied 9.4%; satisfied 35.3%; neither satisfied or dissatisfied 23.8%; dissatisfied 15.8%; very dissatisfied 4.7%; don’t know/no answer 11.0%

How much have you heard about the budget shortfalls state and locals government face as a result of unfunded pensions for employees and retirees? Have you heard a great deal, some, or not very much about this issue? great deal 31.8%; some 32.0%; not very much 28.2%; don’t know/no answer 8.0%

In developing solutions to the current unfunded pension crisis facing local governments, do you think current retirees, current workers, or future workers should bear the biggest burden of pension reform? retirees 4.2%; current workers 6.6%; future workers 9.9%; all equally 64.7%; don’t know/no answer 14.6%

The City of Central Falls filed for bankruptcy and was then able to force the various public-safety unions to the bargaining table to negotiate changes in the city’s retirement obligations. Do you think bankruptcy is a legitimate tool for local government to help restructure their pension obligations? yes 48.0%; no 37.2%; don’t know/no answer 14.8%

How confident are you that in retirement you will be able to maintain the quality of life you have now? Are you very confident, somewhat confident, unsure, not confident, or not at all confident? very confident 11.1%; somewhat confident 21.9%; unsure 29.6%; not confident 15.8%; not at all confident 13.9%; don’t know/no answer 7.7%

When thinking about preparing for retirement, do you think the primary responsibility rests with the worker, the employer, or both equally? worker 18.8%; employer 7.8%; both equally 70.1%; don’t know/no answer 3.3%

Now I have some questions about services in Providence. For each of the following please tell me whether you are very satisfied, satisfied, neither satisfied nor dissatisfied, dissatisfied, or very dissatisfied